Substitute Senate Bill No. 409
Substitute Senate Bill No. 409
PUBLIC ACT NO. 98-79
AN ACT CONCERNING THE FINANCIAL REQUIREMENTS FOR
LICENSING INSURANCE COMPANIES.
Be it enacted by the Senate and House of
Representatives in General Assembly convened:
Section 1. Subsection (a) of section 38a-72
of the general statutes is repealed and the
following is substituted in lieu thereof:
(a) No property or casualty insurance company
and no life insurance company shall be licensed
initially to do business in this state unless the
company complies with the following minimum
capital and minimum surplus requirements to write
these specified lines of insurance:
Stock Insurance Companies
Capital Surplus
Health $ 500,000 $ 500,000
Life 1,000,000 2,000,000
Liability 500,000 500,000
Fidelity and Surety 500,000 500,000
Financial Guaranty 15,000,000 60,000,000
Marine 500,000 250,000
Mortgage Guaranty 2,000,000 2,000,000
Property 500,000 250,000
Workers' Compensation 500,000 500,000
Title 500,000 500,000
RESIDUAL VALUE 2,000,000 1,000,000
REINSURANCE
(PROPERTY AND CASUALTY) 2,000,000 2,000,000
REINSURANCE (LIFE) 1,000,000 2,000,000
Mutual Insurance Companies
Surplus
Health $ 1,000,000
Life 3,000,000
Liability 1,000,000
Fidelity and Surety 1,000,000
Financial Guaranty 75,000,000
Marine 750,000
Mortgage Guaranty 4,000,000
Property 750,000
Workers' Compensation 1,000,000
Title 1,000,000
RESIDUAL VALUE 3,000,000
REINSURANCE
(PROPERTY AND CASUALTY) 4,000,000
REINSURANCE (LIFE) 3,000,000
Sec. 2. Section 38a-76 of the general statutes
is repealed and the following is substituted in
lieu thereof:
(a) Each insurance company transacting
business in this state shall, at all times,
maintain reserves equal in amount to its liability
under all its policy contracts, as the same are
computed in accordance with the provisions of the
statutes or with the requirements of the
commissioner adopted upon reasonable consideration
of ascertained experience for the purpose of
adequately protecting the insured or securing the
solvency of such company.
(b) A DOMESTIC INSURER TRANSACTING INSURANCE
ONLY IN A FOREIGN COUNTRY MAY CALCULATE ITS
RESERVES ON INSURANCE WRITTEN IN THAT FOREIGN
COUNTRY IN ACCORDANCE WITH THE RESERVE STANDARDS
REQUIRED OR OTHERWISE APPROVED BY SUCH FOREIGN
COUNTRY. FOR PURPOSES OF THIS SECTION AND SECTION
38a-77, AS AMENDED BY THIS ACT, (1) A DOMESTIC
INSURER SHALL BE DEEMED TO "TRANSACT INSURANCE" OR
"DO BUSINESS" IN A STATE, DISTRICT OR TERRITORY OF
THE UNITED STATES IF, WITHIN ANY STATE, DISTRICT
OR TERRITORY OF THE UNITED STATES, THAT INSURER
SELLS OR ISSUES ANY POLICY CONTRACT OR OTHERWISE
MAKES ANY SOLICITATION OR INDUCEMENT OR ENGAGES IN
ANY NEGOTIATIONS WITH RESPECT TO THE SAME; BUT (2)
AN INSURER SHALL NOT BE DEEMED TO TRANSACT
INSURANCE OR DO BUSINESS IN A STATE, DISTRICT OR
TERRITORY OF THE UNITED STATES BY REASON OF THE
FACT THAT SUCH INSURER (A) HOLDS A LICENSE TO
TRANSACT INSURANCE IN A STATE, DISTRICT OR
TERRITORY OF THE UNITED STATES; (B) HAS ISSUED
INSURANCE POLICIES OR CONTRACTS TO RESIDENTS OF A
FOREIGN COUNTRY WHO SUBSEQUENTLY RESIDE IN A
STATE, DISTRICT OR TERRITORY OF THE UNITED STATES;
OR (C) PERFORMS ADMINISTRATIVE OR OVERSIGHT
FUNCTIONS IN A STATE, DISTRICT OR TERRITORY OF THE
UNITED STATES. A DOMESTIC INSURER TRANSACTING
INSURANCE ONLY IN A FOREIGN COUNTRY MAY INVEST ITS
FUNDS IN A MANNER CONSISTENT WITH THE LAWS,
REGULATIONS AND ADMINISTRATIVE PRACTICES OF THE
FOREIGN COUNTRY IN WHICH IT TRANSACTS INSURANCE
WITHOUT LIMITATIONS UNDER SECTIONS 38a-102 TO
38a-102h, INCLUSIVE, AS AMENDED BY THIS ACT.
Sec. 3. Subsection (a) of section 38a-77 of
the general statutes is repealed and the following
is substituted in lieu thereof:
(a) The commissioner, upon receipt of the
annual report of each domestic, foreign and alien
life insurance company doing business in this
state, AS DETERMINED UNDER SUBSECTION (b) OF
SECTION 38a-76, AS AMENDED BY THIS ACT, shall make
a valuation of all its outstanding policies,
additions thereto, unpaid dividends and other
obligations. The provisions of this section shall
not apply to policies or certificates in which the
amount of insurance or benefit is determined by an
assessment collected from the surviving and
associated holders of like policies or
certificates, and not by a guaranty or pledge of
insurance irrespective of the amount thus
collected; provided any amount collected upon such
assessments, until expended for the purpose for
which it was collected, shall be charged as a
liability against the company or association
holding the same.
Approved May 22, 1998